JD Durkin: Let’s bring in a market strategist at the New York Stock Exchange. My man. Happy Election Day. Thank you for chatting with us here.
Eric Criscuolo: Always a pleasure, JD.
JD Durkin: Yeah. How about this one? We always say past performance is no guarantee of future results. But going back to 1970, on midterm Tuesday, the S&P averages a gain of 0.44%, [unclear: “today 0.37%”]. Not bad. And there’s a lot for the market to digest on a day like today. History doesn’t always repeat, but it sure does rhyme. What’s been top of mind for you?
Eric Criscuolo: Well, obviously Election Day. Big election, midterms. Balance of power in Congress. I know you know a little bit about that from your former time over there. You know, there’s a lot of moving parts, not just the national elections, but the local elections. What’s on the ballot in some of these communities? Because we could see some effect of data center construction, and what communities are going to be allowing these giant companies to build, which is powering this AI trade, which has lifted markets to close to all-time highs. So there’s a lot of stuff on the ballot that people need to be paying attention to going forward.
JD Durkin: Yeah, we’ll see if that backlash threatens the AI trade, in particular out of [unclear: “racism”] following their governor’s race, out of Georgia, governor’s race out of Texas. Twenty different communities in the great state of Ohio have data centers directly on the ballot. We’ll talk a lot more about that tomorrow. Wall Street overall loves divided government. They love to see the president in one party, and they love to see one, if not both, chambers of Congress controlled by the other. What does history tell us, assuming that right now the market, the S&P, is kind of pricing in the Democrats at least winning the House here tonight?
Eric Criscuolo: Yeah, I mean, I think the overwhelming thought is that they’re going to at least take the House, and maybe probably take the Senate as well. That’s a little less likely according to markets. But it wouldn’t be a total shock if they take both houses. So that’s being slightly priced into the market, and it wouldn’t be a huge surprise. Maybe we trade down a little bit if the Democrats win both. We’ll see. I don’t think it’s going to be a huge reaction. If it is a reaction, it’s probably going to be short-term. Markets tend to just get past it pretty quickly.
And as you brought up history, midterms, after 12 months, after every midterm, going back to, I think, 1980 at least, the market’s been higher. Every single midterm, by about 10% on average. A lot of that is just because stocks tend to go higher historically. But it just says that no matter what happens, the market tends to move past it, pricing other things. And it’s not a bad thing if Democrats win both houses, or if it’s split, or if the Republicans have a miracle.
JD Durkin: Yeah, yeah. Oftentimes we have a bit of a knee-jerk reaction the next morning after an election, especially if the results don’t exactly match up with what our expectations are. And then you’re exactly right. Before long, the market says, well, maybe there’s a silver lining here we hadn’t previously considered, and we tend to move another leg higher. I want to ask you about seasonality. Q4, we are setting up for the sweet spot of the four-year cycle. The midterm year, which we know can be choppy into the midterms. But then again, it’s been a pretty strong 2026. We have outperformed what we usually see in a midterm cycle. How do you think about the rest of the year past today’s date?
Eric Criscuolo: Yeah, I mean, it’s incredible, just given all of the stuff that we have gone through: wars and supply chain disruptions and inflation. Markets are still higher. And a lot of that is just the rotations we’ve seen. Tech brought us so far. Tech started to stall, the trade started to stall, and what happened? All these other sectors started to take the place of it: consumer staples and health care and utilities. Just everything else that lagged took up the slack to keep us above water. And that’s kind of happening right now.
November, very strong month seasonally. Historically one of the best months of the year for stocks. So we’re moving into this very strong seasonality. We get past Election Day, we move into this seasonally strong part, and we get Christmas and the Santa Claus rally, maybe. So the market is looking at the calendar and going, you know what, we could be ending 2026 on a really strong note.
JD Durkin: I had wondered how long past Halloween it would take for someone to mention a Santa Claus rally. I’m glad we get the first reference for the season on FINTECH.TV. I saw Santa Claus hats as I was shopping for Halloween candy early. Well, a really good election, and [unclear: “maybe Thanksgiving is all the best”] for election night coverage. I appreciate you joining us.
Eric Criscuolo: Always a pleasure, man.
